EU green investment labels pose problems for German coalition
Greens are irked by the inclusion of nuclear and gas in the bloc’s taxonomy
Germany’s taxonomy troubles
Brussels’ tortured negotiations over its green labelling rules will be extended by another week, prolonging the recriminations that have surrounded the so-called “taxonomy on sustainable finance”, writes Mehreen Khan in Brussels.
The European Commission’s consultation over its draft taxonomy rules was due to end today but has been prolonged to January 21, allowing a group of independent experts and member states more time to provide their feedback on the controversial treatment of nuclear energy and gas.
A leaked copy of the draft, first reported by the FT, sparked uproar from environmental campaigners and some member states for including nuclear power and natural gas under the green label. The taxonomy is designed to help guide private capital to truly sustainable economic activity to stamp out “greenwashing”.
Germany’s green economy minister Robert Habeck was one of the earliest critics of the draft, using a press conference yesterday to repeat his opposition. “We wouldn’t have needed the second delegated act. The first act was good, it didn’t require the inclusion of nuclear and gas,” he said.
The taxonomy is proving to be an early test of the new coalition’s unity and the Greens’ resolve. The Greens’ coalition partner, the liberal FDP, celebrated the commission’s text, calling gas a vital transitional energy for a country that is weaning itself off nuclear power.
Officials have told Europe Express that Berlin may abstain during a member state vote on the taxonomy due in the coming months. The abstention will have little impact on the approval of the legislation, which has the support of a supermajority of member states.
But strains over the taxonomy could be a foreshadowing of broader splits between the traffic light trio on related EU topics.
Chief among them is the debate on how to reform the EU’s budget rules — where the Greens have pushed for a softer position on the treatment of debt and deficit limits. That’s in contrast to the hawkish FDP who run the finance ministry. The FT reports today on how commission officials are trying to heal rifts between frugal northerners and the south over the upcoming reform of the Stability and Growth Pact.
And before MEPs and member states have their say on the taxonomy, it will first have to pass through the college of commissioners. Johannes Hahn, EU budget and human resources commissioner, told Europe Express he has “strong reservations” about the safety, security and economics of nuclear power.
Austria and Luxembourg have said they will sue the commission over the rules in protest at the inclusion of nuclear power. Hahn, an Austrian, echoed Vienna’s opposition and warned the taxonomy opens the door for “nuclear operations to continue well beyond 2050, which in my view is no longer a transition”.